The Backchannel

The Backchannel - Raise Smarter

When investors decide whether to trust a founder, the deck is only the start. The real check often happens off the slides, in calls to people who know the founder, the company or the deal. A run of fraud headlines this fall has put that check in the spotlight. Here’s what happened in two cases, what the research says about referred deals, and how founders and fund managers can earn trust through people before the first call.

The Lead Case: Joonko

Last month, on September 11, Joonko’s founder pleaded guilty to securities fraud, according to the U.S. Attorney’s Office for the Southern District of New York. Here’s what prosecutors describe:

  • Joonko raised about $27 million: roughly $10 million in a Series A in June 2021 and about $17 million in a Series B in June 2022, from investors “including venture capital firms.”
  • The company claimed customers that “were never Joonko customers.”
  • In 2023, an investor became suspicious and asked for bank statements. The founder sent a forged one showing an average balance of more than $5 million, then fictitious purchase orders with forged signatures.
  • She faces a maximum of 20 years. Sentencing hasn’t happened yet.

The most important detail for founders and investors alike: the fraud surfaced because one investor asked for primary documents. Attorney Michael Kimball, writing on October 2, points out that the customer claims could have been checked by calling the named customers through independently found contacts, rather than contacts the founder supplied.

A Supporting Case: SKAEL

The New York Post reported on October 20 that SKAEL raised more than $40 million selling “digital employees.” Its founder admitted inventing revenue from companies that never subscribed and supplying bank records showing payments that never arrived. He pleaded guilty in June 2025 and was sentenced in November 2025 to a year and a day.

Reading the “$500 Million” Headline Carefully

The same Post article tallies more than $500 million lost by investors across cases tied to Linqto, SKAEL and GameOn. Context matters:

  • Most of it is Linqto, a platform that sold pre-IPO shares, not a startup raising a venture round. Linqto allegedly took in more than $450 million from over 13,000 customers. Its founder denies wrongdoing.
  • GameOn’s founder allegedly raised more than $60 million using fake bank statements and forged audit reports. He’s under indictment, with a jury trial set for September 2027. Nothing has been proven.
  • SKAEL is an admitted case, as described above.

So it isn’t a measure of fraud in venture rounds. It’s a tally of alleged and admitted losses across very different situations. CPA Francine McKenna told the Post: “This is the worst we’ve seen in the 40 years I’ve been auditing and observing the industry.”

Why the Check Falls to Investors

The Post also cites Cornerstone Research: the SEC filed 456 enforcement actions in fiscal 2025, down from 583 the year before, and only five against public companies in the first half of fiscal 2026, the fewest for that period in at least 16 years. Private rounds don’t get SEC review before money moves. Whatever your view of enforcement, the practical result is that a lead investor’s diligence is often the first real check.

What the Research Says About Referred Deals

A research summary published October 20 by Pynn reviewed the evidence on warm introductions versus open applications. Two studies stand out.

One firm’s records (Jang & Kaplan, NBER, 2025). An early-stage Midwest firm’s full records covered 8,815 deals from 2015 to 2021. The firm scored 13.5% of co-investor-referred deals, 5.3% of inbound deals and 2.7% of deals it found itself. Two important caveats: this is one firm, and “inbound” mixes cold email with some personal-network referrals. Most important, referral source did not predict which companies became $50 million-plus outcomes.

The classic benchmark (Gompers, Gornall, Kaplan & Strebulaev, 2020). In a survey of 885 VCs run in 2015–16, closed deals came from professional networks (31%), the investors’ own outreach (28%), referrals from other investors (20%), inbound from founders (10%) and portfolio-company referrals (8%). That’s decade-old data, so treat it as a benchmark, not a current measurement.

The honest takeaway: warm introductions don’t pick winners. They help deals move further through the process, because someone credible has vouched for them.

The Backchannel Runs Both Ways

This is the part founders most often miss. The people who would introduce you to an investor are often the same people that investor calls to check you: former colleagues, co-founders, people who reported to you, and your existing investors.

And let’s be clear: these cases are rare. Verification isn’t an accusation. It’s how two parties who don’t know each other yet build enough trust to work together for a decade.

What Founders Can Do Now

  1. Assume the call happens, and make it easy. Before you raise, reconnect with the people who know your work. Tell them what you’re building and resolve any old friction.
  2. Make your claims easy to verify. Offer customer calls and clean documentation up front. In a news cycle like this one, openness stands out.
  3. Choose introducers who can vouch. A warm introduction is a reference given in advance. Pick people who’ve seen your work, not just people who know your name.
  4. Model, test, adjust. Ask a mentor to run a mock reference call with two of your references, then tighten what you share.

What GPs Can Do Now

  1. Document your diligence. Keep a reference log on every deal: on-list and off-list calls, what was verified and who confirmed it. When something goes wrong anywhere, LPs ask, “Who did you call?”
  2. Know your referral network’s track record. Gompers et al. found top and bottom firms had similar sourcing mixes and suggested the difference may be “the quality of their referral network.”
  3. Verify through the backchannel, but don’t make it the only door. Referral channels can under-represent less-connected founders.

Earn Trust Before the Call

Every warm introduction carries information a deck can’t: someone who has seen you work is putting their name next to yours. That’s why relationship capital is built before the raise, not during diligence.

ConnectLab.live maps warm paths alongside your own contacts, so you can see who in your network already sits close to the investors who fit your raise. It doesn’t replace diligence; it helps the right people find each other through people they trust.

Connection is the currency of the 21st Century.

Who are the three people you’d most want an investor to call about you, and when did you last talk to them?

If you’d like help with that, here’s an open invitation:

Sources

About Ken McArthur

Ken McArthur is the founder of ConnectLab.live, an AI relationship-intelligence and warm-intro platform that helps founders who are raising find the funds that fit and the people who can introduce them, and helps fund managers connect with the founders they back. He was recently accepted into Harvard Business School Foundry. He also writes Raise Smarter, a daily newsletter on what's really moving in early-stage fundraising. Ken challenges us to realize we ALL have an impact, whether we want to or not, on thousands of people we touch in our day-to-day lives, and he shows that simple things make a HUGE difference. ConnectLab.live grew out of that belief. Connection is the currency of the 21st Century, and the right introduction can change a company's future. Long before ConnectLab, Ken was the popular host of live events that brought together top-level marketers, entrepreneurs, business owners, corporations and non-profit organizations to build multi-million dollar joint venture relationships. He has managed product launches ranked in the top 400 sites on the Internet and is regularly asked to speak at leading marketing events. He created AffiliateShowcase.com, a pioneering affiliate program search engine and directory. He also founded the MBS Internet Research Center, which conducted the world's largest survey ever attempted on creating and launching successful information products. Ken was the official mentor for Sterling Valentine as he took his launch from zero to over $100,000 in less than 8 days, a proof of concept documented in Info Product Blueprint. Today he puts that same skill for connecting people and launching ideas to work for founders and the investors who back them.

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